Crypto morning: Bitcoin (BTC) surpasses $30,000 in its worst month in 12 months and is already showing a slight increase in the accumulated for the week

Charlie Taylor

Cryptocurrency investors are still trying to recover from the fall of last week and small purchases give strength to Bitcoin (BTC) this Tuesday (17). In the last 24 hours, BTC is up 3.4% to $30,657, according to data from CoinGecko. Ethereum (ETH) gains 4% at $2,091. In the last seven days, BTC is up 1%. In Brazil, Bitcoin rose 2.7%, trading at R$155,780, according to the Bitcoin Portal Index (IPB).

LFG reserves

In May, the largest cryptocurrency lost 21%, the worst monthly performance in 12 months, impacted by the implosion of the TerraUSD (UST) stablecoin, data from Bloomberg shows. Edward Moya, senior market analyst at Oanda, explains in a note that investors took advantage of the price drop for small purchases, which gives BTC a boost, but many retail and institutional players “still have big wounds from the recent collapse”. Ethereum also disappoints. The second-largest cryptocurrency is down 60% from its November record and could still drop 80%, according to John Roque, a technical analyst at 22V Research. The Luna Foundation Guard (LFG) released a statement on Monday to detail how it spent millions of dollars on crypto to maintain UST parity with the dollar. LFG’s reserves dropped from around 80,000 BTC to 313. The remaining assets (UST and LUNA tokens) could be used to compensate investors. Do Kwon, founder of Terraform Labs, argued on Monday that the Terra blockchain needs to undergo a “hard fork” that will split the current network in two. The old version will be called ‘Terra Classic’ and the new one, just ‘Terra’. In an interview with Bloomberg TV, Rohit Chopra, director of the US Department of Consumer Financial Protection, stated that stablecoins are not yet ready to be used as a means of payment and expects “movement” in regulation of the crypto industry later this year. Another problem algorithmic stablecoin is DEI, from the decentralized finance protocol DEUS Finance, which started to lose parity with the dollar on Sunday (15), according to data from CoinMarketCap.

Institutional Presence

Institutional investors hit the cryptocurrency market in 2021, which also helped push up the price of Bitcoin. Now, players question the weight of big investors in the recent sell-off in the crypto industry, whose market value has shrunk by $1.25 trillion since its high in late 2021, CoinDesk analysis shows. The three-month correlation between Bitcoin and Ethereum with major U.S. stock indices hit a record high last week, according to Dow Jones Market Data. Another factor that can influence the institutional presence is the lower liquidity environment, which makes betting cautious. Venture capitalists are among the biggest investors in the cryptocurrency industry. In an interview with the newspaper O Globo, the CEO of Mercado Bitcoin, Reinaldo Rabelo, said that, in addition to the fact that venture capital funds no longer raise funds as before, the cloudy economic scenario and the approach of elections in Brazil disfavor initial public offerings for funding. .

investment flow

Despite the turmoil, digital asset investment products saw record inflows this year, totaling $274 million in the week ended May 13, highlights a CoinShares report, according to which the UST collapse and sell-off were seen as an opportunity. to buy. Investors bet on BTC funds, with inflows of $299 million, apparently in search of the “relative safety” of the biggest cryptocurrency. For trader Tone Vays, former vice president of graphic analysis at JPMorgan, the current price level is a unique opportunity to invest in Bitcoin paying less, according to Estadão. Major altcoins also trade in the blue on Tuesday as Binance Coin (+4.2%), XRP (+3.1%), Cardano (+2.9%), Solana (+5%), Polkadot (+ 3.4%), Dogecoin (+2.3%), Avalanche (+6.8%) and Shiba Inu (+3.4%), according to data from CoinGecko.

Other highlights

TC, financial education platform, data analysis and capital market intelligence, began offering cryptocurrency trading to 620,000 users registered on its application through integration with the Bitcoin Market.

The Agrotokenan Argentine agricultural commodity tokenization company, and Visa signed a partnership to create a card so that rural producers can pay for any type of purchase with tokenized grains, according to Valor.

Nomura has released a unit for accessing digital assets to institutions, according to the Financial Times. The division will have a staff of 100 employees by the end of 2023 and offer exposure to cryptocurrencies, decentralized finance (DeFi) and non-fungible tokens (NFTs). Last week, the Japanese investment bank held its first crypto derivatives trade.

On Japanese crypto exchange Liquid, recently purchased by FTX, the atmosphere is one of chaos, former employees told CoinDesk. According to the sources, Liquid played down security and compliance issues, in addition to cursing and berating staff. Liquid did not comment.

Regulation, Cybersecurity and CBDCs

Portugal wants to start taxing the gains made by investors in the country from trading cryptocurrencies. During a hearing at the Assembly of the Republic on Friday (13), Finance Minister Fernando Medina confirmed that the government is committed to creating a legal framework in which investors’ profits from the sale of crypto-assets such as Bitcoin are taxed.

Former Federal Reserve Chairman Ben Bernanke told CNBC that Bitcoin does not function as cash, a store of value or digital gold. “If Bitcoin were a substitute for fiat money, you could use it to buy groceries,” Bernanke said. “No one buys groceries with Bitcoin because it is too expensive and too inconvenient.”

The President of El SalvadorNayib Bukele, said that 32 central banks and 12 financial authorities – from nations such as Paraguay, Angola, Egypt and Nigeria – were gathered in the country on Monday to talk about Bitcoin and its benefits, according to Estadão.

The US-EU Trade and Technology Council plans to collaborate on research and development of technology to track carbon emissions, as per the statement. And blockchain could be a possible tool for measuring greenhouse gas emissions and lifespan assessments, CoinDesk points out.

Metaverse, Games and NFTs

After the collapse of the TerraUSD stablecoinnon-fungible tokens will be on the radar of investors, attentive to the most speculative and leveraged areas of the crypto market, highlights Morgan Stanley report published by InfoMoney.

Champion of the Carnival of Rio de Janeiro in 2022, Grande Rio decided to celebrate the title with a collection of NFTs. The tokens highlight the theme of the parade and one of them honors Exú, the orixá that was the theme of the Duque de Caxias school in 2022, according to Exame.

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